Dior can bar resale of its goods by discount stores - ECJ

04 May '09

5 min read

Next, the Court holds that a sale that takes place in disregard of a provision prohibiting resale to discount stores outside the selective distribution network may, for the purposes of the directive, be considered to have taken place without the consent of the proprietor of the trade mark where it is established that such a breach contravenes one of the provisions listed in the directive.

Even though, as a general rule, it must be considered that goods bearing the trade mark are put on the market by a licensee with the consent of the proprietor of the trade mark, the fact remains that a licence agreement does not constitute the absolute and unconditional consent of the proprietor of the trade mark to the licensee putting the marked goods on the market.

The directive expressly enables the proprietor of the mark to invoke the rights the trade mark confers on him against a licensee where the latter contravenes certain provisions in the licence agreement.

Therefore, the directive must be interpreted as meaning that where a licensee puts goods on the market in disregard of a provision in a licence agreement, this precludes exhaustion of the rights conferred by the trade mark on its proprietor for the purposes of the directive if it can be established that that provision is included in those listed in Article 8(2) of the directive.

Finally, the Court holds that damage done to the reputation of a trade mark may, in principle, be a legitimate reason, within the meaning of the directive, allowing the proprietor to oppose the use of his trade mark for further marketing of luxury goods put on the market in the EEA by him or with his consent.

European Court of Justice

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